Delhi HC Rejects Cheque-Bounce Petitioners’ Bid to Reopen Defence, Citing ₹8,383 Balance at Account Closure

The respondent filed complaints under Section 138 of the Negotiable Instruments Act, 1881, after cheques issued by the petitioners were dishonoured with the remark “Account Closed.”

The petitioners sought to reopen their defence evidence and summon State Bank of India officials, with bank records, to establish that the account had been closed pursuant to bank or RBI instructions rather than voluntarily.

They said a letter dated 8 September 2021 supporting their position had only recently been traced.

The Magistrate dismissed the application, which had been filed at the stage of judgment.

The petitioners challenged that dismissal before the High Court

Section 311 of the Code of Criminal Procedure, 1973, and its corresponding provision, Section 348 of the Bharatiya Nagarik Suraksha Sanhita, 2023, were invoked in relation to summoning witnesses and reopening defence evidence; the petitions also invoked the High Court’s inherent jurisdiction under Section 482 CrPC/Section 528 BNSS

The complaints arose under Section 138 of the Negotiable Instruments Act, 1881

The Court cited Adinarayana v. P.N. Sridhar Bhattar and Nagaraja Upadhya v. M. Sanjeevan, but distinguished them on the facts, noting that they did not concern accounts containing a balance grossly insufficient to meet the cheques.

The judgment did not set out a broader test governing applications under Section 311 CrPC/Section 348 BNSS.

The Court noted that the application to reopen the defence was made only at the judgment stage and that the Trial Court had recorded a balance of just ₹8,383 in the account when it was closed, an amount grossly insufficient to honour the cheque.

It reasoned that, even if the account had been closed on the Bank’s or RBI’s instructions rather than by the petitioners, that circumstance would not assist them given the inadequate balance.

The Karnataka High Court decisions relied on by the petitioners were distinguishable because they lacked a finding of such insufficiency.

Accordingly, the Court found no infirmity in the Trial Court’s order.

Pending applications were also disposed of